On The Brink with Castle Island

Guy Young (Ethena) on the Past and Future of Crypto Interest Rates (EP.507)

Feb 28, 2024

Exploring crypto interest rates, Ethena launch reflections, yield farming viability, convergence of tradfi and crypto yields, Eigenlayer concerns in DeFi, stablecoin supply impact on rates, Guy Young's medium-term expectations for crypto rates.

48:53

Creator website

Episode guests

Guy Young

AI Summary

AI Chapters

Episode notes

Podcast summary created with Snipd AI

Quick takeaways

Understanding origins of crypto yields crucial for sustainability post-ETF speculation.

Ethena's potential to drive interest rate convergence in DeFi, CFI, and TradFi ecosystems.

Deep dives

Athena Launch and Crypto Yields Origins

The podcast episode reflects on the first 10 days of the Athena launch, discussing how crypto yields are generated and their interaction with traditional buy interest rates. It highlights the impact on stablecoin supply and future trends in crypto yields, considering the existence of Athena and potential developments post-Bitcoin and Ether ETFs.

Introduction

2min

Exploring Athena's Recent Milestone and Post-Launch Experience

2min

Analysis of High Funding Rates and Market Enthusiasm

2min

Athena vs. Terra Luna Yield Study

7min

Exploring the Benefits of Athena and Token Composability in DeFi Applications

3min

Ethena's Impact on Crypto Interest Rates

25min

The Interplay of Real Interest Rates and Crypto Rates

9min

Guy Young, the founder of Ethena, rejoins the show to give us an update on Ethena and to discuss the nature of crypto interest rates.

In this episode:

Reflections on the Ethena launch
ETH funding rates versus ETH ETF expectations
Funding rates on crypto native exchanges versus CME
Why Ethena versus doing the cash and carry trade
At what point does Ethena start to drive down funding rates
The history of the cash and carry trade in crypto
Did yield farming represent a real form of yield?
Why is yield farming less viable today?
The ultimate convergence between tradfi and crypto yields
Where risk premia come from for Ethena versus the risk free rate
ETH taking yields and their development
Guy’s concerns about Eigenlayer and its effect on DeFi
Interactions between real rates and crypto rates
Stablecoin supply versus tradfi interest rates
Crypto yields versus RWA supply
The share of stablecoins that is speculative in nature
Guy’s expectations for the medium term future of crypto rates

Remember Everything You Learn from Podcasts

Save insights instantly, chat with episodes, and build lasting knowledge - all powered by AI.

On The Brink with Castle Island

Guy Young (Ethena) on the Past and Future of Crypto Interest Rates (EP.507)

Episode guests

Podcast summary created with Snipd AI

Quick takeaways

Deep dives

Athena Launch and Crypto Yields Origins

Market Conditions and Yield Expectations

Challenges in ETH Staking and Funding Rates

Athena's Role in Interest Rate Convergence

Remember Everything You Learn from Podcasts